Friday, February 27, 2009

MYTH BUSTED: No Increase to Business Taxes, even for Joe the Plumber

Internet Journalist Thomas HayesWhy are pro-business Republicans among the critics suggesting Obama's proposal includes a tax hit on people who run the small businesses that those same Republicans always insist drive job growth in the USA? Are they worried about the Joe-the-Plumber scale businesses? If so, it's already been documented that neither Joe nor his boss earned enough to be hit by the new taxes, and so they'd likely see a tax reduction. Don't forget, for these purposes "small business" includes up to 500 employees.

It's a curious thing - but to actually gross the $250,000 that represents the threshold for the tax increase is not common for small business owners. I know - I was one. I created jobs, I had more staff than my predecessor had in the same business, and I paid for health coverage for my full time staff (my part-timers had coverage through other sources) and even though the business moved a lot of cash through my bank, I didn't come close to grossing 6 figures. Many small business owners actually earn less than their best paid employees do, and that's even more true today that it was 10 years ago.

According to the Associated Press, an independent analysis estimated that just over 75% of all U.S. households would qualify for Obama's proposed tax credit for workers.

Did you know that there are over 3 times as many businesses in the USA without any employees as there are with employees? That's right, many professionals in partnerships, sole proprietorships, some S-Corps, and many who "organize" themselves as a for tax reasons as a business earn little or no taxable income from their business. So sure, some of those folks who are very successful and are technically small businesses on paper will end up paying more taxes - if their accountants can't figure out how to structure the cash flow to keep their paycheck under $21,000/month.

But the GOP has been campaigning for years - and often winning - based on accusing the Democrats of being the party of tax and spend. So even though that old familiar attack didn't work during the general election in 2008 their messaging gurus apparently don't have another theme ready. And that means we're going to hear about the mythical "drag on the economic engine of small business job creation" until the GOP finds somebody that makes for better coverage than former Massachusetts Governor Romney, or current Governors such as Palin, Pawlenty, and Jindal.

Buzz it up at Yahoo
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Schwarzenegger Says Reporter Says "Wacky Things"

This is a classic video on Gov. Schwarzenegger 's personality.

Stevie Wonder presented with Gershwin Award by President Obama

This was an amazing ceremony for a man that too was part of my childhood -- Stevie Wonder. His music has expanded in the digital age to shape our culture and yet people like President Obama and myself can say we were there when "Stevie" was born. Wow.